Amendment of a compulsory sectoral pension scheme: compulsory sectoral pension fund versus social partners
“Compulsory pension funds not obliged to implement changes agreed upon by social partners”
Two recent examples in Dutch case law illustrate the lack of clarity about who is authorised to implement changes in compulsory industry-wide pension funds: the social partners or the pension fund. Such clarity is needed because pension schemes will have to change with the switch from the current to the new pension system. This issue has two key questions: Is an industry-wide pension fund obliged to implement the pension scheme that social partners have agreed upon? And if it refuses to do so, can social partners exert an enforceable influence? This study investigates possible routes out of this quagmire.
Key Takeaways for the Industry
- Social partners currently lack legally enshrined amending powers in industry-wide pension funds.
- Future impasses can be avoided via one of three routes: 1) give social partners the legal authority to initiate changes, 2) ensure no pension changes can be legally implemented without industry-wide approval, or 3) provide clear legislation that enables social partners and pension funds to jointly realise the necessary changes.